CAMBRIDGE – In game theory, the “price of anarchy” describes how individuals acting in their own self-interest within a larger system tend to reduce that larger system’s efficiency. It is a ubiquitous phenomenon, one that almost all of us confront, in some form, on a regular basis.
For example, if you are a city planner in charge of traffic management, there are two ways you can address traffic flows in your city. Generally, a centralized, top-down approach – one that comprehends the entire system, identifies choke points, and makes changes to eliminate them – will be more efficient than simply letting individual drivers make their own choices on the road, with the assumption that these choices, in aggregate, will lead to an acceptable outcome. The first approach reduces the cost of anarchy and makes better use of all available information.
Syrian War
Syria’s Shattered Mosaic

John Andrews views the country’s civil war in the context of the Middle East’s strategic disarray, assessing how Shlomo Ben-Ami, Christopher Hill, Anne-Marie Slaughter, and others think the outcome will reshape the region.

The world today is awash in data. In 2015, mankind produced as much information as was created in all previous years of human civilization. Every time we send a message, make a call, or complete a transaction, we leave digital traces. We are quickly approaching what Italian writer Italo Calvino presciently called the “memory of the world”: a full digital copy of our physical universe.
As the Internet expands into new realms of physical space through the Internet of Things, the price of anarchy will become a crucial metric in our society, and the temptation to eliminate it with the power of big data analytics will grow stronger.
Examples of this abound. Consider the familiar act of buying a book online through Amazon. Amazon has a mountain of information about all of its users – from their profiles to their search histories to the sentences they highlight in e-books – which it uses to predict what they might want to buy next. As in all forms of centralized artificial intelligence, past patterns are used to forecast future ones. Amazon can look at the last ten books you purchased and, with increasing accuracy, suggest what you might want to read next.
But here we should consider what is lost when we reduce the level of anarchy. The most meaningful book you should read after those previous ten is not one that fits neatly into an established pattern, but rather one that surprises or challenges you to look at the world in a different way.
Contrary to the traffic-flow scenario described above, optimized suggestions – which often amount to a self-fulfilling prophecy of your next purchase – might not be the best paradigm for online book browsing. Big data can multiply our options while filtering out things we don’t want to see, but there is something to be said for discovering that 11th book through pure serendipity.
What is true of book buying is also true for many other systems that are being digitized, such as our cities and societies. Centralized municipal systems now use algorithms to monitor urban infrastructure, from traffic lights and subway use, to waste disposal and energy delivery. Many mayors worldwide are fascinated by the idea of a central control room, such as Rio de Janeiro’s IBM-designed operations center, where city managers can respond to new information in real time.
But with centralized algorithms coming to manage every facet of society, data-driven technocracy is threatening to overwhelm innovation and democracy. This outcome should be avoided at all costs. Decentralized decision-making is crucial for the enrichment of society. Data-driven optimization, conversely, derives solutions from a predetermined paradigm, which, in its current form, often excludes the transformational or counterintuitive ideas that propel humanity forward.
A certain amount of randomness in our lives allows for new ideas or modes of thinking that would otherwise be missed. And, on a macro scale, it is necessary for life itself. If nature had used predictive algorithms that prevented random mutation in the replication of DNA, our planet would probably still be at the stage of a very optimized single-cell organism.
Decentralized decision-making can create synergies between human and machine intelligence through processes of natural and artificial co-evolution. Distributed intelligence might sometimes reduce efficiency in the short term, but it will ultimately lead to a more creative, diverse, and resilient society. The price of anarchy is a price well worth paying if we want to preserve innovation through serendipity.

]]>https://rajmohod.wordpress.com/2016/10/10/the-hidden-danger-of-big-data/feed/0rajmohodOnly 44% Of U.S. Adults Are Employed For 30-Or-More Hours Per Weekhttps://rajmohod.wordpress.com/2015/02/07/only-44-of-u-s-adults-are-employed-for-30-or-more-hours-per-week/
https://rajmohod.wordpress.com/2015/02/07/only-44-of-u-s-adults-are-employed-for-30-or-more-hours-per-week/#respondSat, 07 Feb 2015 08:30:58 +0000http://rajmohod.wordpress.com/2015/02/07/only-44-of-u-s-adults-are-employed-for-30-or-more-hours-per-week/Exploring the World: by Michael Snyder via The Economic Collapse blog, Jim Clifton, the Chairman and CEO of Gallup, says that the percentage of Americans that are employed full-time has been hovering near record lows since the end of the last recession. But most Americans don’t realize this because the official unemployment…]]>

]]>https://rajmohod.wordpress.com/2015/02/07/only-44-of-u-s-adults-are-employed-for-30-or-more-hours-per-week/feed/0rajmohodThe Piglet, the Sheep, and the Goathttps://rajmohod.wordpress.com/2014/09/13/the-piglet-the-sheep-and-the-goat/
https://rajmohod.wordpress.com/2014/09/13/the-piglet-the-sheep-and-the-goat/#respondFri, 12 Sep 2014 20:17:35 +0000http://rajmohod.wordpress.com/?p=186Continue reading The Piglet, the Sheep, and the Goat→]]>A YOUNG PIG was shut up in a fold-yard with a Goat and a Sheep. On one occasion when the shepherd laid hold of him, he grunted and squeaked and resisted violently. The Sheep and the Goat complained of his distressing cries, saying, “He often handles us, and we do not cry out.” To this the Pig replied, “Your handling and mine are very different things. He catches you only for your wool, or your milk, but he lays hold on me for my very life.”
]]>https://rajmohod.wordpress.com/2014/09/13/the-piglet-the-sheep-and-the-goat/feed/0rajmohodSome nice picshttps://rajmohod.wordpress.com/2013/12/26/activity-based-costing/
https://rajmohod.wordpress.com/2013/12/26/activity-based-costing/#respondWed, 25 Dec 2013 19:11:53 +0000http://rajmohod.wordpress.com/?p=175
]]>https://rajmohod.wordpress.com/2013/12/26/activity-based-costing/feed/0rajmohodAshton Kutcher takes product engineering job at Lenovo, first tablets look like Apple Wireless Keyboardshttps://rajmohod.wordpress.com/2013/10/30/ashton-kutcher-takes-product-engineering-job-at-lenovo-first-tablets-look-like-apple-wireless-keyboards/
https://rajmohod.wordpress.com/2013/10/30/ashton-kutcher-takes-product-engineering-job-at-lenovo-first-tablets-look-like-apple-wireless-keyboards/#respondWed, 30 Oct 2013 11:24:18 +0000http://rajmohod.wordpress.com/2013/10/30/ashton-kutcher-takes-product-engineering-job-at-lenovo-first-tablets-look-like-apple-wireless-keyboards/https://rajmohod.wordpress.com/2013/10/30/ashton-kutcher-takes-product-engineering-job-at-lenovo-first-tablets-look-like-apple-wireless-keyboards/feed/0rajmohodMETAPHYSICS —- Aristotlehttps://rajmohod.wordpress.com/2013/08/07/metaphysics-aristotle/
https://rajmohod.wordpress.com/2013/08/07/metaphysics-aristotle/#respondWed, 07 Aug 2013 14:34:36 +0000http://rajmohod.wordpress.com/?p=124Continue reading METAPHYSICS —- Aristotle→]]>ALL men by nature desire to know. An indication of this is the delight we take in our senses; for even apart from their usefulness they are loved for themselves; and above all others the sense of sight. For not only with a view to action, but even when we are not going to do anything, we prefer seeing (one might say) to everything else. The reason is that this, most of all the senses, makes us know and brings to light many differences between things. By nature animals are born with the faculty of sensation, and from sensation memory is produced in some of them, though not in others. And therefore the former are more intelligent and apt at learning than those which cannot remember; those which are incapable of hearing sounds are intelligent though they cannot be taught, e.g. the bee, and any other race of animals that may be like it; and those which besides memory have this sense of hearing can be taught. The animals other than man live by appearances and memories, and have but little of connected experience; but the human race lives also by art and reasonings. Now from memory experience is produced in men; for the several memories of the same thing produce finally the capacity for a single experience. And experience seems pretty much like science and art, but really science and art come to men through experience; for ‘experience made art’, as Polus says, ‘but inexperience luck.’ Now art arises when from many notions gained by experience one universal judgement about a class of objects is produced. For to have a judgement that when Callias was ill of this disease this did him good, and similarly in the case of Socrates and in many individual cases, is a matter of experience; but to judge that it has done good to all persons of a certain constitution, marked off in one class, when they were ill of this disease, e.g. to phlegmatic or bilious people when burning with fevers-this is a matter of art. With a view to action experience seems in no respect inferior to art, and men of experience succeed even better than those who have theory without experience. (The reason is that experience is knowledge of individuals, art of universals, and actions and productions are all concerned with the individual; for the physician does not cure man, except in an incidental way, but Callias or Socrates or some other called by some such individual name, who happens to be a man. If, then, a man has the theory without the experience, and recognizes the universal but does not know the individual included in this, he will often fail to cure; for it is the individual that is to be cured.) But yet we think that knowledge and understanding belong to art rather than to experience, and we suppose artists to be wiser than men of experience (which implies that Wisdom depends in all cases rather on knowledge); and this because the former know the cause, but the latter do not. For men of experience know that the thing is so, but do not know why, while the others know the ‘why’ and the cause. Hence we think also that the masterworkers in each craft are more honourable and know in a truer sense and are wiser than the manual workers, because they know the causes of the things that are done (we think the manual workers are like certain lifeless things which act indeed, but act without knowing what they do, as fire burns,-but while the lifeless things perform each of their functions by a natural tendency, the labourers perform them through habit); thus we view them as being wiser not in virtue of being able to act, but of having the theory for themselves and knowing the causes. And in general it is a sign of the man who knows and of the man who does not know, that the former can teach, and therefore we think art more truly knowledge than experience is; for artists can teach, and men of mere experience cannot. Again, we do not regard any of the senses as Wisdom; yet surely these give the most authoritative knowledge of particulars. But they do not tell us the ‘why’ of anything-e.g. why fire is hot; they only say that it is hot. At first he who invented any art whatever that went beyond the common perceptions of man was naturally admired by men, not only because there was something useful in the inventions, but because he was thought wise and superior to the rest. But as more arts were invented, and some were directed to the necessities of life, others to recreation, the inventors of the latter were naturally always regarded as wiser than the inventors of the former, because their branches of knowledge did not aim at utility. Hence when all such inventions were already established, the sciences which do not aim at giving pleasure or at the necessities of life were discovered, and first in the places where men first began to have leisure. This is why the mathematical arts were founded in Egypt; for there the priestly caste was allowed to be at leisure. We have said in the Ethics what the difference is between art and science and the other kindred faculties; but the point of our present discussion is this, that all men suppose what is called Wisdom to deal with the first causes and the principles of things; so that, as has been said before, the man of experience is thought to be wiser than the possessors of any sense-perception whatever, the artist wiser than the men of experience, the masterworker than the mechanic, and the theoretical kinds of knowledge to be more of the nature of Wisdom than the productive. Clearly then Wisdom is knowledge about certain principles and causes.
]]>https://rajmohod.wordpress.com/2013/08/07/metaphysics-aristotle/feed/0rajmohodBattery Maker Exide Files for Chapter 11 Bankruptcyhttps://rajmohod.wordpress.com/2013/06/10/battery-maker-exide-files-for-chapter-11-bankruptcy/
https://rajmohod.wordpress.com/2013/06/10/battery-maker-exide-files-for-chapter-11-bankruptcy/#respondMon, 10 Jun 2013 11:52:39 +0000http://rajmohod.wordpress.com/2013/06/10/battery-maker-exide-files-for-chapter-11-bankruptcy/24/7 Wall St.: Auto battery maker Exide Technologies Inc. (NASDAQ: XIDE) filed for Chapter 11 bankruptcy protection this morning. The company is on the hook for a $31 million interest payment in August and $52 million convertible notes maturing in September. To fund its restructuring, Exide has received a loan of $500 million…]]>

Auto battery maker Exide Technologies Inc. (NASDAQ: XIDE) filed for Chapter 11 bankruptcy protection this morning. The company is on the hook for a $31 million interest payment in August and $52 million convertible notes maturing in September.

To fund its restructuring, Exide has received a loan of $500 million from J.P. Morgan Chase & Co. (NYSE: JPM). The Wall Street Journal notes that this is Exide’s second bankruptcy filing, having filed previously in 2004.

The road to ruin was paved in 2010 when the company lost the contract to supply car batteries to Wal-Mart Stores Inc. (NYSE: WMT) to competitor Johnson Controls Inc. (NYSE: JCI). Exide never really recovered the hit to its revenues.

On top of that, the company’s California lead recycling plant was shut down in April for violating state regulations. At that time the company hired Lazard to…